Buy-to-let mortgage calculator
A buy-to-let mortgage is sized by the rent, not your salary. Lenders apply a rental cover test (the ICR): the monthly rent must cover the mortgage interest at a stressed rate, by about 125% for basic-rate and limited-company landlords or 145% for higher-rate taxpayers. The maximum loan the rent supports is the annual rent divided by the stress rate times the ICR. At £1,200 rent, a 5.5% stress and 145% ICR, that is about £180,000, subject to a loan-to-value cap of around 75%.
How the rental cover test works
A buy-to-let lender does not start from your income. It checks that the rent will cover the mortgage interest with a safety margin, calculated at a stressed interest rate rather than the pay rate. That margin is the interest coverage ratio (ICR). Turn the test around and it gives you a maximum loan:
Maximum loan = (monthly rent × 12) ÷ (stress rate × ICR)
Worked example
Take a higher-rate-taxpayer landlord expecting £1,200 a month in rent, a lender using a 5.5% stress rate and a 145% ICR. The annual rent is £14,400. Divide it by 0.055 × 1.45 (0.07975) and the rent supports a maximum loan of about £180,564. If the property is worth £250,000, the 75% loan-to-value cap (£187,500) sits just above that, so here the rent is the binding constraint. On a basic-rate or limited-company basis at 125% ICR the same rent would stretch to about £209,455.
Scenario table
Indicative maximum loan supported by the rent, at a 5.5% stress rate. The 75% loan-to-value cap may bite first on a lower-value property.
| Monthly rent | 125% ICR (basic-rate / limited company) | 145% ICR (higher-rate taxpayer) |
|---|---|---|
| £1,000 | £174,545 | £150,470 |
| £1,250 | £218,182 | £188,088 |
| £1,500 | £261,818 | £225,705 |
| £2,000 | £349,091 | £300,940 |
Indicative only, using a 5.5% stress rate as a general benchmark. Actual stress rates, ICRs and LTV caps vary by lender and by fixed-rate term, and some lenders top-slice with personal income. Not a quote and not advice. Last reviewed 24 July 2026.
Check it for real
Run your own figures and get matched
The table above shows the method. Use this buy-to-let calculator to run your own rent and property value, and if you choose, be introduced to a regulated broker who can find a lender whose stress test fits. Provided by our partner Propillo. Information, not advice, and no obligation.
Where the numbers move
- Your tax position. Higher-rate taxpayers face the tougher 145% ICR, so the same rent supports less. Many landlords buy through a limited company (SPV), assessed at 125%.
- The fixed-rate term. Some lenders stress five-year fixes at a lower rate, which can lift the maximum loan noticeably.
- Top-slicing. Where the rent falls short, a lender that top-slices can use your personal income to bridge the gap. Not all do.
- Property type. An HMO or holiday let is assessed differently again.
Common questions
How is buy-to-let borrowing worked out?
Not on your income, but on the rent. A buy-to-let lender applies a rental cover test (the interest coverage ratio, or ICR): the monthly rent must cover the mortgage interest, calculated at a stressed rate, by a set margin. Rearranged, the maximum loan the rent supports is the annual rent divided by the stress rate times the ICR. A separate loan-to-value cap, usually around 75%, also applies, and the lower of the two sets your maximum.
What is the ICR and why is it 125% or 145%?
The interest coverage ratio is the margin by which rent must exceed the stressed interest. It reflects your tax position. Lenders commonly use around 125% for basic-rate taxpayers and limited-company landlords, and around 145% for higher-rate taxpayers, because higher-rate landlords keep less of the rent after tax. A higher ICR means the same rent supports a smaller loan.
What stress rate do lenders use?
It varies, but a figure around 5.5% is a common general benchmark for the rental stress test, and some lenders use a lower stress on longer fixed rates (for example five-year fixes). The stress rate is usually higher than the actual pay rate, which is why a property that cashflows in real life can still fail the test on paper. These figures are indicative, not a rule.
Does my own income matter for a buy-to-let?
Often yes, as a gate rather than the main test. Many lenders want a minimum personal income (frequently around £25,000) and some will top-slice, using surplus personal income to support a loan the rent alone would not quite cover. Portfolio landlords face extra checks. A broker will know which lenders top-slice and which judge the rent in isolation.
New to it? Start with the buy-to-let mortgages hub, or work out the yield first with the rental yield calculator.
Founder, MortgageExplained
Adam spent nearly a decade as a mortgage adviser at Just Mortgages, with further experience in commercial finance. He is CeMAP and CF qualified. He built MortgageExplained to do one thing well: explain mortgages in plain English, then introduce you to a regulated broker when you are ready. Every page is written and reviewed by Adam.
Last reviewed: 24 July 2026